The Member of Parliament (MP) for Ofoase-Ayirebi, Kojo Oppong-Nkrumah has stated that although headline inflation has fallen to 3.3%, production costs for local businesses remain high.
Speaking during the Minority’s engagement with the Ghana Union of Traders Associations (GUTA), he criticised the government’s methods for reducing inflation, calling them unsustainable and warning that the headline figure does not reflect the cost of production.
He said the Minority has repeatedly urged the government to change and interrogate the methods it uses to achieve the numbers it publishes.
He accused the government of using a sterilisation approach, noting that it sterilised about GHC 62 billion from the economy in 2025 and parked it at the central bank.
“It is what is called the shock approach to achieve that number of 3.3 that is why the governor is saying that the pop up exercise has cost him about GHC billion to bring it down to 3.3, that is you remove money from the system, it hasn’t dealt with the cost of production because electricity is going up, labour is going up and other inputs in production,” he stated.
Oppong-Nkrumah added that it is not enough to lower the policy rate, indicating that the volume of credit reaching the private sector must also be seen to be growing.
He therefore argued that policymakers must focus on reducing production costs.
“If what they will do is to focus on the cost of production to ensure that electricity bill for example has brought to the optimal level by our calculation the latest reduction should not be anything less than 10% if you look at the currency appreciation and input,” he stated.
Source: Vanessa Elizabeth Nkum
